Dollars from Good Scents

On the inside cover of a popular women’s magazine is a picture of a corked perfume bottle bearing Yves Saint Laurent’s name and a slogan, “Its name was forbidden, but women will know to ask for it.” The ad is for the controversial perfume “Champagne,” which after a lawsuit won by the wine producers of one of France’s most famous regions, was forced to change its marketing strategy as well as its label. However, by the time the smoke had cleared from the court battlegrounds, the fragrance appeared to be somewhat a winner, racking up 200 million francs in sales in just three months of existence. In an industry built around dreams, fantasies and image, nothing beats a little scandal to stir up interest and sales.

This is not the first time YSL has been the center of controversy over its perfumes. In 1983, the couturier audaciously launched a fragrance called “Paris,” a name that touched off anger and jealousy in the French capital because it had been always been off-limits to perfumers. Four years later, demonstrators protesting the name of another sweet extremely popular sensation, “Opium,” claimed the house was encouraging the use of an illegal substance. Last year when Saint Laurent claimed the name “Champagne” for its lychee and nectarine scented fragrance, the uproar came as somewhat of a surprise, according to an inside source. When Yves Saint Laurent selected the name in 1991, the choice did not appear to be a problem. According to the financial journal Les Echos, Pierre Bergé, president of YSL, claims he discussed the name with Bernard Arnault of the group LVMH (the company that owns the prestigious Moët et Chandon, the world’s leading producer of Champagne), who was said to voice no objections. The name had, in fact, been registered in 1943 as a fragrance trademark by Parfums Caron (which in 1992 came out with “Bain de Champagne.”) According to a report in the Financial Times, YSL spent an estimated 3 million francs to buy the trademark and register it worldwide. (Incidentally, the name “Opium” was purchased for $200 from another perfumer in the 1970s, and ten years later, Chanel paid more than $500,000 to a magazine editor for the worldwide rights to the name “Egoiste.”)

Plans ran into a snag last summer when the Champagne growers, upon learning of the promotion, initiated legal proceedings against YSL, claiming the existence of a perfume called “Champagne” could confuse consumers and imperil the prestige of its product. (In 1984 the firm Seita was also sued over its “Champagne” cigarettes.) Almost one month after the launch of the controversial perfume, the courts ruled against YSL, demanding 150,000F in damages plus 75,000F in interest. The company was given until the end of December to remove all bottles, packaging and promotional material bearing the label “Champagne,” under penalty of 3,000F for each item confiscated thereafter. (The ruling is applicable only in France; as of this writing, “Champagne” will continue to be sold abroad under its original name, with a launch planned in New York at Saks Fifth Avenue on Valentine’s Day.) In France, however, the decision was made to relaunch it simply with Yves Saint Laurent’s signature, a tactic used for the launch of “Opium” in Saudi Arabia years before.

“We had good intentions,” claims Claude Saujet, a YSL spokesperson who defended taking advantage of the scandal to help launch the perfume. According to an article in the Financial Times, “‘Champagne’ is a veritable hit in perfume stores, particularly in the Champagne region in towns like Epernay, especially since it was banned.” The inside source at YSL said many customers, thinking the perfume would be completely removed from the market, emptied the store shelves of the product, figuring it would be worth a lot later to collectors.

Every time you dab on a bit of perfume, you take part in an enormous worldwide competition within a global industry worth some $13 billion annually. According to the Fédération Française des Industries des Parfumeries, sales of perfume and toiletries have risen steadily by 35 percent over the past 20 years (with the exception of the last two years, when earnings stagnated). The number of perfume launches has increased as well. In 1992, 35 perfumes were launched in France, compared with 18 in 1982 and seven in 1972. Moreover, the New York Fragrance Foundation reports that some 75 new scents were launched in the US last year, though statistics suggest that only 15 companies will recover their launch costs within three years, and fewer than that will see a monumental success.

A launch costs up to $50 million for a worldwide campaign of a major fragrance, though smaller companies like those of designer Jean-Paul Gaultier and jeweler Alain Boucheron have spent considerably less. And though the actual cost of the materials inside the bottle represents a scant 5 percent of the total cost of the fragrance, you are paying for the astronomical cost of base materials: flower oils and animal substances, two years of research and development, distillation equipment, the advertising campaign, packaging, image and, of course, company profits. A lot of money for a pipe dream? Consider the story about a woman who complained to Christian Dior about the outrageous price of a hat, given the cost of the materials. The designer dismantled it and gave her the wisp of tulle and the rose, saying, “The materials, Madame, are free. It is the invisible, the magic, that most of us are happy to pay for.” An anonymous pretty scent in a no-frills bottle (like the now defunct Bic perfumes in the US or Marcel Bich in the UK) has a very short life span.

“A perfume begins with an idea, the vision of the fragrance,” explains Jean Kerleo, one of the industry’s top experts, employed as Jean Patou’s “nez” (nose). “This must be translated step by step into the industrial mass production of the perfume oil. A creative perfumer can see in his mind’s eye a rough outline of a new fragrance formula before actually beginning the composition phase of the product. He works with a highly developed sense of smell and begins with smelling strip of absorbent paper imbued with fragrance substances, which are sniffed and evaluated.

“Next, a formula of fragrance components or ingredients is drafted, from uniform, chemically pure ingredients to complex foundations. These are made up of pre-composed basic accords of fragrance mixtures using natural and synthetic substances. The finished product usually consists of 20 to 30 components, though the more complex formulas can have up to 200.” In spite of all the research involved in creating the vital combination of oils and aromas, as little as 15 percent of a bottle of perfume is actually oil, about 55 percent is alcohol, the rest distilled water. In a bottle of eau de parfum, the oil content can be as low as 8 percent, and in eau de toilette as low as 4 percent.

Although a perfume may boast high notes of jasmine or undertones of musk, the vast majority of perfume oils are produced in a laboratory. Synthetics are less expensive than their natural equivalents and the price, quality and supply can be controlled. Grasse, in the south of France, provided many of the flowers for the perfume industry until tourism pushed up the price of land along the French coast and made large scale flower cultivation uneconomical. When frost hit the Californian orange crop in December 1991 the price of natural orange oil soared. And until recently perfumers have imported much of their oak moss and lavender from the former Yugoslavia and many of the resinous fragrances from Somalia. There are now fears that supplies from both areas could be jeopardized.

After a first trial run, the ingredients are weighed and mixed in a laboratory according to the perfumer’s instructions. Each day thereafter, he returns to the composition, smelling and adjusting his creation, re-evaluating the results and recommending changes. Once the finished composition has met with satisfaction, a computer monitors, memorizes and prints out single ingredients of the composition and indicates market prices of each component. Parallel to this is the development of marketing strategies and ad campaigns, as well as the monumental job of designing the flacon, which can add upwards of a million dollars to the cost.

Like high fashion, movie stars and the sparkle of fine jewelry, perfume evokes dreams and visions of grandeur in spite of the ominous risks involved. Best-sellers are vastly profitable. Chanel No. 5, the world’s number one perfume, and Guerlain’s Shalimar see $120 million in annual sales. After the initial, expensive promotional period ends, the cost of manufacturing and marketing falls to 35 percent of the sales, leaving the perfumer with the potential of enormous profits.

The launch of a significant new fragrance, such as “Champagne,” is carefully coordinated so that the product is presented to consumers in the same way in every country. With global branding, the name of the game in the industry, buying perfume in France to take back to the folk in the States is no longer a big deal, since most major brands can be found in department stores or duty free shops the world over. Still, there are a few places left in Paris where fragrances that exist nowhere else can be found: marvelous Oriental fragrances like “Sikkim” at L’Institut Lancôme (29, rue du Fbg. St. Honoré, 8e); blackberry, musk and much more at L’Artisan Parfumeur (24, bd. Raspail, 7e, and 22, rue Vignon, 9e) and, my favorite, Parfums Caron (34, av. Montaigne, 8e), where re-editions from the past like Tabac Blond (1919), Pois de Senteur (1927) and French Cancan (1938) are dispensed from Louis XVI-style Baccarat crystal and gilded bronze urns set against a backdrop of pearl-gray satin draperies and crystal chandeliers.

Popular brands are sold at discount prices in numerous boutiques around the city. Here are a few to consider: Eden (212, rue de Rivoli, 1er), Michel Swiss (24, av. de l’Opéra, 1er) and Raoul & Curly (47, av. de l’Opéra, 2e). Each of these places feature specials of up to 30 percent off regular prices of top perfume and beauty products. Have a very aromatic Valentine’s Day!